DOW JONES NEWSWIRES
Biogen Idec Inc.'s (BIIB) second-quarter profit fell 31% on a $110 million payment regarding its partnership and licensing pact with Acorda Therapeutics Inc. (ACOR).
The payment masked strong sales of Biogen's Tysabri multiple-sclerosis drug and the company's results topping expectations.
The payment also made Biogen cut its full-year earnings outlook to at least $3.85, including a 38-cent impact from the payment. The old view, which didn't include such a factor, was at least $4. Biogen also reiterated its sales view.
Biotech drug makers have benefited from stable demand for their products, but investors worry about healthcare-reform efforts potentially hurting drug prices, and allowing the sale of copycat versions of key drugs.
The drug developer reported earnings of $142.9 million, or 49 cents a share, down from $206.6 million, or 70 cents a share, a year earlier. Excluding acquisition and other costs but including the Acorda payment, earnings fell to 75 cents from 91 cents.
Revenue rose 10% to $1.09 billion.
Analysts surveyed by Thomson Reuters were expecting earnings, excluding items, of 68 cents a share on revenue of $1.07 billion.
Biogen is focused on making doctors more comfortable with using Tysabri, which returned to the market in 2006 after an 18-month withdrawal over a suspected link to a debilitating brain infection. Incidences of the infection have become more frequent in recent months.
Sales of Tysabri, sold with Elan Corp. PLC (ELN), rose 27%. Biogen said about 43,000 people worldwide were taking the drug. Biogen's shares dropped last month following the company's disclosure of a brain infection in a patient taking Tysabri, the 13th case of the infection. Three patients have died.
Sales of Avonex, the company's flagship MS drug, rose 12%.
The company lost a proxy fight last month with billionaire activist investor Carl Icahn, who won two seats on its board and has suggested Biogen ought to be split up or sold.
Biogen shares closed Wednesday at $46.67 and were inactive premarket.
-By Mike Barris, Dow Jones Newswires; 212-416-2330; mike.barris@dowjones.com